Thu February 20, 2014

U.S. Government To Back Loans For Nuclear Power

The first nuclear reactors to be built in decades are getting a helping hand from the government. Today, Secretary of Energy Ernest Moniz is in Georgia to mark billions in assistance towards the construction of two new nuclear units in the state.

NPR's Geoff Brumfiel reports that building reactors is still an expensive proposition.

GEOFF BRUMFIEL, BYLINE: The Department of Energy is not providing money for the construction of these new nuclear reactors. Instead, it will provide a guarantee that if the companies have trouble making payments, the agency will foot the bill for $6.5 billion in loans.

Construction is already under way at the Vogtle Electric Generating Plant in Georgia. Speaking at the National Press Club yesterday, Secretary Moniz said the shiny new AP1000 reactors would provide a lot of electricity.

SECRETARY ERNEST MONIZ: Once completed, these new units at Vogtel will produce enough safe, reliable and carbon-free energy to power about 1.5 million homes.

BRUMFIEL: Advocates for nuclear are pleased by the guarantees. Scott Peterson is a vice president at the Nuclear Energy Institute, an industry group. He says the agreement sends a message that nuclear power is still attractive, even after the catastrophic melt downs at the Fukushima Daiichi nuclear plant in Japan.

SCOTT PETERSON: As we start to see the economy bounce back, and we see electricity demand starting to increase, I believe we'll see more nuclear plants being built.

BRUMFIEL: But others say don't hold your breath. Dimitry Nikas follows utilities for the ratings company Standard and Poor's. He says nuclear plants are still big, expensive things to build. And with natural gas prices low, most utilities are opting to build those plants instead.

DIMITRY NIKAS: There's a lot more certainty and a lot less cost in producing electricity through a power plant that burns natural gas.

BRUMFIEL: Even with today's announcement, America won't be seeing new nuclear power anytime soon. The units in Georgia won't come online before 2017.